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The permanent magnet is considered as a component for changing the form of energy, and a brief review of the basic physics of the permanent magnet is included with emphasis on the nature of the magnetization process and how the permanent magnet functions in establishing external magnetic field energy. Presently availabIe characteristics of permanent magnets and future possibilities for improving the efficiency of the permanent magnet are discussed as well as the relationships between audio device performance and the unit properties of permanent magnets. In using the permanent magnet, the choice of unit properties, volume, geometry, and magnetic circuit arrangement greatly influence the end performance and efficiency of audio devices. As an aid in exploiting the optimum combination of these variables an electrical analog system using lumped constants is introduced. Data on leakage permeance are presented for the more widely used permanent magnet arrangements in audio work. The analog technique is of general interest from the viewpoint of understanding the energy relationships involved in the efficient application of the permanent magnet and as an aid in predicting permanent magnet performance on a firm engineering basis.